Monday, 8 June 2015.

2.30 pm

Several noble Lords took the oath, and signed an undertaking to abide by the Code of Conduct.

Smith Commission: Implementation

Question

2.37 pm

Asked by Lord Wigley

To ask Her Majesty’s Government whether they regard the implementation of the recommendations of the Smith Commission as an adequate response to the outcome of the general election in Scotland.

The Parliamentary Under-Secretary of State, Scotland Office (Lord Dunlop) (Con): My Lords, the Scotland Bill will deliver in full the historic Smith commission agreement to devolve further powers to the Scottish Parliament within a strengthened United Kingdom, as agreed by all the main political parties in Scotland last November. The implementation of the Smith commission agreement shows this Government’s commitment to make the Scottish Parliament one of the most powerful devolved parliaments in the world.

Lord Wigley (PC): My Lords, before the referendum on 18 September last year, many people in Scotland were led to believe that home rule was on the table. The Smith commission report in no way fulfils any meaningful interpretation of the term “home rule”. In those circumstances, is it not now time to look at new solutions—a balanced constitutional solution for the United Kingdom, on a confederal basis—that can meet the aspirations of Scotland, Northern Ireland, Wales and, indeed, England itself?

Lord Dunlop: My Lords, the Smith agreement was agreed by all five of Scotland’s main political parties. I believe that is the first time in the history of devolution that that has happened. It will create, as I have already said, one of the most powerful devolved parliaments in the world. This Government’s commitment is to deliver Smith in full, and we are doing so. Of course, as my right honourable friend the Prime Minister has said, we are open to sensible, evidence-based proposals that others might wish to table. However, I should make two points. It is only just over nine months ago that the people of Scotland voted clearly and decisively to remain within the United Kingdom, with all the benefits that that involves, and we need to respect that. It is also worth making the point that for those who believe in separation, there is no package of further devolution that will be sufficient.

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Lord Forsyth of Drumlean (Con): My Lords, does my noble friend not agree that, given that the SNP repudiated the Smith commission proposals before the ink was even dry on them, and given that the three unionist parties—the Conservative, Liberal and Labour parties—got only one seat at the subsequent general election, the Smith commission proposals are clearly not going to meet the aspirations of the Scottish people, and that we need a constitutional convention that will provide a solution that meets the needs of all parts of the United Kingdom and provides some stability, so that we can get on with discussing health and education and the things that matter to the people of Scotland?

Lord Dunlop: My Lords, it is not a characterisation I would agree with that the electorate of Scotland repudiated the Smith agreement. Every one of the manifestos of all the main parties, including the SNP, included a commitment to take forward the Smith agreement. Of course, there will be discussions, and I know that there are many views within this House about how best to do that, but the main objective—the Government’s main commitment and priority—is to take forward the commitment we made to implement the Smith agreement.

Lord Reid of Cardowan (Lab): My Lords, the Minister will recall that, having agreed the Smith commission proposals, the SNP then wanted to go much further: for full fiscal autonomy on the basis of its rather spurious estimate for the future of the Scottish economy. That was based on oil at $113 a barrel. This morning, oil was around $60 a barrel, opening up a £7 billion or £8 billion black hole in projected Scottish public expenditure. Has he received any recent demands from the SNP for full fiscal autonomy?

Lord Dunlop: My Lords, I am not sure exactly where the SNP stands now on full fiscal autonomy. Its position seems to change by the day but I am absolutely clear, and the Government are clear, that full fiscal autonomy would be bad for Scotland. By the end of this Parliament, it would leave a £10 billion funding gap that would have to be addressed by higher taxes or larger spending cuts in Scotland. The noble Lord is absolutely right that one of the benefits of being part of the UK is that which comes from pooling and sharing resources, so that public expenditure remains relatively stable when revenue flows such as oil and gas are so volatile.

Lord Wallace of Tankerness (LD): My Lords, I welcome the fact that the Government are honouring their commitment to bring in a Bill to deliver the Smith commission proposals. However, does the Minister accept that when responding to the request of the First Minister of Wales for a constitutional convention before the referendum, the Prime Minister accepted that there would need to be an open, involved and comprehensive conversation about the kind of union we want to see and that, 15 years after the process of devolution started, we should consider the best way to go about doing so? What consideration are the Prime Minister and the Government giving to that very necessary constitutional convention?

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Lord Dunlop: It is absolutely right that, in addition to taking forward the commitments to constitutional reform in each part of our United Kingdom, including England, it is necessary to look at how those devolution settlements work as a whole. That is why the Government are committed to reviewing the intergovernmental arrangements and taking them forward in discussion with the devolved Administrations. We will do that, and listen carefully to the lively debate which I am sure will take place on how best we can make our devolution settlements work as a whole.

Lord Foulkes of Cumnock (Lab): My Lords, will the Minister confirm that there are lots of wealthy people in Scotland—landowners, industrialists and so on, not all of whom, by the way, are now members of the Tory party—and will he tell the House what action the so-called radical left-wing Scottish Government have taken to redistribute wealth within Scotland, using their existing tax powers?

Lord Dunlop: The noble Lord makes a very good point indeed. In addition to debating and asking for more powers, the debate should increasingly focus on how the Scottish Government intend to use their existing powers and the very considerable powers that will be coming their way in the very near future.

Lord Anderson of Swansea (Lab): My Lords, we do not do constitutions in this country. Why do we always proceed in a piecemeal way? What is the Government’s precise objection to the constitutional convention being proposed by other parties?

Lord Dunlop: I do not believe we are proceeding in a piecemeal way. We will be taking forward four strands of constitutional change over the course of this Parliament: change in Scotland, in Wales and in Northern Ireland, and, as I have said, fairness for England. We will listen very carefully to the discussion about how these devolution settlements work as a whole, and I look forward to some lively further discussion in this House.

Economy: Productivity

Question

2.45 pm

Asked by Lord Haskel

To ask Her Majesty’s Government what action they will take to increase productivity as compared to that forecast in Table 5b of the Bank of England May inflation report.

The Commercial Secretary to the Treasury (Lord O'Neill of Gatley) (Con): My Lords, productivity is a key challenge for this Parliament and a key focus. That is why, before the Budget, the Chancellor will publish a productivity plan, which will be a plan to make Britain work better.

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Lord Haskel (Lab): My Lords, I welcome the Minister to his first Oral Questions. I also welcome his words, but I think that many noble Lords will agree with me that we have heard these promises before. However, manifestly, they have not worked. Why not? Will the Minister agree with me that they have not worked because they do not understand that productivity involves every aspect of our economic life and beyond—a life which is presently dominated by austerity? So, once again, I ask the Minister whether the Government will demonstrate their commitment to productivity by moving on from a life of austerity to a life of productivity.

Lord O'Neill of Gatley: My Lords, as your Lordships can tell, I am not yet very familiar with the exact procedural formalities. I apologise, as I should be. I have been immersed in studying issues to do with productivity for a large part of my adult life. It is dangerous to associate productivity improvements with a so-called focus either on austerity or on some other particularly cyclical fiscal policy stance.

We are living through a moment in time when a very large number of diverse developed countries are all apparently showing a dramatic slowing in measured productivity, whether it be Germany, which is generally regarded as successful and whose measured productivity has been even weaker than ours in the past few years, or the United States, which is frequently regarded as a beacon. In my maiden speech last week, as those of your Lordships who were here would have heard, I highlighted a number of factors that will be focused on. When the Chancellor makes his presentation, I think your Lordships will see that those feature highly in the appropriate steps we plan to implement.

Baroness Kramer (LD): My Lords, does the Minister agree that employee ownership models, such as the John Lewis model, tend to enhance productivity? If so, will he take steps to share that understanding, especially with small and medium-sized companies, and consider tax incentives?

Lord O'Neill of Gatley: The ideas that are being thought about include appropriate incentives to boost long-term investments and greater incentives for both the owners and participants in any company, whether privately owned or otherwise. The role of tax incentives is very important and they will be looked at further.

Lord Kinnock (Lab): The Minister is correct to say of course that productivity has slowed throughout the OECD countries. However, as he acknowledged in his maiden speech last week, our record is palpably worse than so many other OECD countries. Does he accept that increasing productivity needs extra investment, better skills and decent pay? Will he therefore encourage the Government to reverse the 50% cut in net public investment since 2010, the ongoing 40% cut in further education for the over-19s since 2010 and the 6% loss in average earnings in this country? Is it not clear that unless those reversals are made, there is no hope of our country resuming the 15% increase necessary to return to our historic trend, let alone securing the 30% increase necessary to catch up with our comparable competitors?

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Lord O'Neill of Gatley: My Lords, it is important to remind noble Lords that I referred to “measured productivity”. There are considerable issues to be focused on about aspects of how productivity is measured. Again as I highlighted in my maiden speech, the UK in the past few years has had the best employment increase record throughout the G7 countries. One does not need to look at a choice between employment and productivity, but if one were forced to do so, I think that most people in this country would want jobs and not to get so lost in the productivity issues. However, I also add that—as is well known—over the long term, countries that have the better true productivity performance are those with generally a higher standard of living and wealth, including in shared wealth. In that regard, let me repeat some of the policies that I suggested will be focused on. They will include rebuilding the northern powerhouse, improving our infrastructure, undertaking policies to improve the supply of new homes, further reforms of education and apprenticeships and—this is linked to my previous comment—boosting incentives for long-term investment.

Baroness Farrington of Ribbleton: My Lords, the Minister referred to the importance of employment. Would he care to comment on the fact that the personal income of people in employment ought to be sufficient for them to be self-sufficient—that is, a living wage? Would he care to endorse the—apparently—lately formed views of the Mayor of London that the Government ought to stop subsidies to companies which make huge profits while paying pittances to the people the Minister referred to, who want not only employment but a living wage and dignity?

Lord O'Neill of Gatley: The policies we will focus on will be those to boost the long-term performance of the economy from a productivity perspective, which will help enhance the job satisfaction of many people in our country.

NHS: Seven-day Working

Question

2.52 pm

Asked by Lord Hunt of Kings Heath

To ask Her Majesty’s Government what assessment they have made of the impact of the current deficit position of NHS Trusts and NHS Foundation Trusts on the ability of the National Health Service to move to seven-day working.

Baroness Chisholm of Owlpen (Con): My Lords, seven-day services will need to be implemented in an affordable way, focusing on both improving efficiency and delivering clear benefits to patients. We have increased the NHS budget by £12.7 billion over the Parliament and in some situations we have provided interim financial support—but this is dependent on trusts developing and sticking to a strong recovery plan. At the heart of all that, we are making sure that trusts continue to deliver safe and sustainable services within a balanced financial position.

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Lord Hunt of Kings Heath (Lab): My Lords, I am very grateful to the noble Baroness for that response. Does she accept that you cannot achieve full seven-day working, including at the weekend, without employing more doctors, nurses and diagnostic staff? Given that NHS trusts are projected to have a £2 billion deficit this financial year, how will that be afforded? Can she confirm for me that the decision of NICE last week to pull work on guidance on nurse/patient ratios, which came out of the Mid Staffordshire situation, was the result of pressure from NHS England because of concerns about affordability?

Baroness Chisholm of Owlpen: My Lords, it is clear that the NHS faces significant financial challenges due to increasing demands. Seven-day services will need to be implemented in a way that is affordable and focused on both improving efficiency and delivering clear benefits to patients. The costs of the seven-day services will depend on many factors. We are working with NHS England to identify how to achieve the aim of providing seven-day services efficiently.

Baroness Howarth of Breckland (CB): My Lords, would the Minister explain how a seven-day service would function when, at the moment, to gain a GP’s appointment people are waiting sometimes two weeks? It is about demand as well as timing. Some GP practices are needing to reduce the number of doctors because of a lack of finance in their budgets. Is this not going backwards, not forwards to a seven-day service?

Baroness Chisholm of Owlpen: My Lords, the Government are committed to improving access to GPs’ services, including delivering services seven days a week to ensure that people are able to access primary medical care when they need to. At present, £175 million, including £25 million from the £1 billion infrastructure fund, has now been invested in the GP access fund to improve access to general practice. The first wave was announced in September 2013 and the second in March this year. So there are now 57 schemes covering more than 2,500 practices, meaning that more than 80 million patients—one-third of the country—will benefit from improved access.

Baroness Walmsley (LD): My Lords, in this as with many issues, one size does not fit all, so could the Minister say whether the Government are doing any research as to how their objective for a seven-day-a-week service can be delivered in different kinds of neighbourhoods? The solution for cities may not be suitable for rural areas or small towns, and there are probably many opportunities for innovation, such as near where I live in the small city of Chester, where the Countess of Chester Hospital has a GP unit. Could we not look at what the cottage hospitals and main general hospitals can do to assist general practices in providing this sort of service and keeping people out of A&E?

Baroness Chisholm of Owlpen: My Lords, certainly we are looking at all those ideas, and we will gather together all the data that we need before we go forward. But I feel that I should say that there are indicators for this service that cannot be measured, and one of them

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is quality of life. As a former nurse, at the forefront of my mind was always the question of whether my patient was getting the best care from me, from the specialist and from the hospital. In my book, a seven-day service goes towards achieving that goal.

Baroness Armstrong of Hill Top (Lab): Is the Minister perhaps being just a little complacent about just how difficult things are? In the small ex-mining town where I live, in the north-east of England, I discovered on Friday that the GP practice that normally has seven to eight doctors now has three, two of whom are salaried. They are simply not able to offer any decent service, let alone a seven-day-a-week service, to patients in that small town and the surrounding villages. Does the Government not recognise that the model is broken and that they have to be far more urgent in addressing the issues that millions of people in this country face and that undermine confidence in the NHS?

Baroness Chisholm of Owlpen: My Lords, I think that the answer that I gave before about the GP access fund answers what my noble friend was saying. As we know, the Government are committed to ensuring that everyone can get the care that they need, seven days a week. Seven-day services are backed by senior clinicians, who recognise the vast improvement in patient care that can be achieved. We know that it reduces patient mortality. Expanding services to seven days a week has the potential to improve the patient experience, reduce the length of stay and chance of readmission and make better use of expensive resources such as staff and equipment.

Lord Kakkar (CB): My Lords, I declare my interest as chairman of University College London Partners. What assessment have Her Majesty's Government made of the potential impact of the European working time regulation on their aspiration to enhance seven-day working in the National Health Service?

Baroness Chisholm of Owlpen: My Lords, as outlined in the coalition agreement, the Government are committed to limiting the application of the working time directive in the UK.

Greater Manchester: New Deal

Question

3 pm

Asked by Lord Naseby

To ask Her Majesty’s Government what is the anticipated timescale of the new deal for Greater Manchester.

The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Williams of Trafford) (Con): My Lords, the Greater Manchester devolution deal states that legislation will be passed to enable the first Greater Manchester city region mayor elections to take place in early 2017. The Cities and

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Local Government Devolution Bill, which was introduced into this House on 28 May, provides the necessary primary legislation framework to deliver the Greater Manchester deal and other future deals.

Lord Naseby (Con): I congratulate Her Majesty’s Government on introducing the Bill. Is the Minister aware that one of the benefits of electioneering is that it gives Peers the opportunity to see the real world? I canvassed in Northamptonshire, Bedfordshire and Cambridgeshire, each of which is really vibrant and active economically. Against that background, can Her Majesty’s Government, and the Minister in particular, look at these counties and similar counties and ensure that they can benefit from initiatives similar to those powers that are being given to Greater Manchester?

Baroness Williams of Trafford: I thank my noble friend for his kind words. Like him, I canvassed and campaigned up and down the country. It was good to see the real world of the north of England. I take his point about our counties and what they have to offer. Each county is different, and each group of counties will be different, and the Government are certainly open to listening to any suggestions that they bring forward.

Lord McKenzie of Luton (Lab): My Lords, we support the Greater Manchester devolution deal. In a recent speech, the Chancellor of the Exchequer talked about conversations of a serious nature for the devolution of powers and budgets for any city that wants an elected mayor. Are there any other conversations about serious devolution going on at the moment with those who do not want an elected mayor?

Baroness Williams of Trafford: My Lords, there are certainly lots of conversations going on at the moment. There is no one common deal to suit everyone. The Government are very keen to hear from cities, counties and rural areas and any combination of the above.

Lord Shipley (LD): My Lords, does the Minister agree that such deals should be subject to a local referendum to give legitimacy to the new structures which are being introduced?

Baroness Williams of Trafford: The noble Lord will recall that, back in 2007, the Local Government and Public Involvement in Health Act provided for resolutions of councils, not referenda, when going to a mayoral model for single authorities. This replicates that provision so, no, I do not.

Lord Grocott (Lab): My Lords, in the real world of the north to which the Minister referred, and I add the Midlands and various other parts of the country, a decision was made by the previous Government to hold referendums in 10 cities—this is further to the two previous questions on a very similar theme—against the wishes of many of us who thought the referendums were a costly waste of time. The results were quite spectacularly clear: in nine of the 10 cities, the idea of a directly elected mayor was resoundingly defeated. With the Government so concerned and interested in referendums, democracy and consulting the people,

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can the Minister confirm what seems to me to be the Government’s position that they regard the results of those referendums as of no significance whatever?

Baroness Williams of Trafford:The noble Lord is absolutely right on one measure: referenda were held for city mayors and in the main they were rejected. They were an entirely different proposition from what we have now, which involves real transfer of powers.

Lord Kinnock (Lab): If the Government’s commitment to Greater Manchester and its constituent parts is to be meaningful, are they about to reverse the 40% budget cuts inflicted upon Manchester and the surrounding areas?

Baroness Williams of Trafford: My Lords, Greater Manchester has come forward with a proposal that is fiscally neutral; the plan uses the money that government currently puts into certain services, and Greater Manchester plans to use that money more efficiently and to engender growth in the process. Greater Manchester has not asked for additional money.

Baroness Farrington of Ribbleton (Lab): My Lords, was the Minister’s answer to my noble friend Lord Kinnock that, yes, the 40% cut that is already in place will stay and that those who come in will have to manage within it?

Baroness Williams of Trafford: My Lords, my answer to the noble Lord was that Greater Manchester has not asked for any additional public funding. This proposition between government and the combined authority has nothing to do with council budgets; it is an entirely different thing.

Lord Brooke of Alverthorpe (Lab): On the same theme, does the Minister recall that, in the Police Reform and Social Responsibility Act 2011, Manchester, along with many other local authorities, asked the Government to devolve to the local level the right to set licensing for alcohol? The Government gave an undertaking to do that. In 2014, they reversed their decision. Now that we have this change before us, when will Manchester get the right to take its own decisions locally on licensing amounts?

Baroness Williams of Trafford: My Lords, in terms of the devolution deal, Manchester has not requested licensing as one of the devolved powers, but I can write to the noble Lord with further details on licensing locally.

Lord Newby (LD): My Lords, if Manchester asked for more money, would the Government give it any?

Baroness Williams of Trafford: My Lords, the Government have made it absolutely clear that these deals are fiscally neutral, and that has been understood by Greater Manchester.

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Lord Snape (Lab): My Lords, as my noble friend Lord Grocott points out, the city of Manchester rejected the idea of an elected mayor and now has a non-elected mayor. While I am second to none in my admiration for Mr Tony Lloyd, democracy can hardly be said to have prevailed in and around that great city. How soon will it be before the city of Birmingham, which also rejected the idea of a directly elected mayor, has a non-elected mayor to cover the rest of Birmingham and the West Midlands? What guarantees will Her Majesty’s Government give that mayors, whether elected or non-elected, will be provided with adequate resources to meet the demands of the facilities that are being devolved from Her Majesty’s Government?

Baroness Williams of Trafford: My Lords, the Birmingham city region has not yet reached an agreement with government on a mayor. I am sorry, but I have forgotten the second part of the noble Lord’s question.

Lord Snape: The simple question is: where is the money coming from, and when?

Baroness Williams of Trafford: The mayor, if there is one, can raise the mayoral precept in due course.

Referendums (Local Authority Governance) Bill [HL]

First Reading

3.07 pm

A Bill to allow local authorities which have opted for a mayor and cabinet executive in a referendum to hold further referendums under Part 1A of the Local Government Act 2000.

The Bill was introduced by Lord Tope (on behalf of Baroness Janke), read a first time and ordered to be printed.

European Union (Information, etc.) Bill [HL]

First Reading

3.08 pm

A Bill to make provision for information to be available in various public places relating to the activities and organisation of the European Union; to make provision for the flying of the flag of the European Union on various government and public buildings; to provide information to further the establishment of twinning arrangements between towns in the United Kingdom and elsewhere in the European Union in accordance with the European Union’s town twinning support scheme; and for connected purposes.

The Bill was introduced by Lord Dykes, read a first time and ordered to be printed.

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Medical Innovation Bill [HL]

First Reading

3.09 pm

A Bill to make provision about innovation in medical treatment.

The Bill was introduced by Lord Saatchi, read a first time and ordered to be printed.

Welfare of Cats (Breeding and Sale) Bill [HL]

First Reading

3.09 pm

A Bill to make provision about the commercial breeding of cats; and for connected purposes.

The Bill was introduced by Lord Black of Brentwood, read a first time and ordered to be printed.

Deputy Chairmen of Committees

Administration and Works

Communications

Constitution

Delegated Powers and Regulatory Reform

Economic Affairs

Membership Motions

3.10 pm

Moved by The Chairman of Committees

Deputy Chairmen of Committees

That, as proposed by the Committee of Selection, the following members be appointed as the panel of members to act as Deputy Chairmen of Committees for this session:

That a Select Committee be appointed to consider administrative services, accommodation and works, including works relating to security, within the strategic framework and financial limits approved by the House Committee;

That, as proposed by the Committee of Selection, the following members together with the Chairman of Committees be appointed to the Committee:

That the Committee have power to send for persons, papers and records;

That the Committee have power to appoint specialist advisers;

That the Committee have power to adjourn from place to place;

That the Committee have leave to report from time to time;

That the reports of the Committee be printed, regardless of any adjournment of the House;

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That the evidence taken by the Committee in the last session of Parliament be referred to the Committee;

That the evidence taken by the Committee be published, if the Committee so wishes.

Delegated Powers and Regulatory Reform

That a Select Committee be appointed:

(i) To report whether the provisions of any bill inappropriately delegate legislative power, or whether they subject the exercise of legislative power to an inappropriate degree of parliamentary scrutiny;

(ii) To report on documents and draft orders laid before Parliament under or by virtue of:

(a) sections 14 and 18 of the Legislative and Regulatory Reform Act 2006,

(b) section 7(2) or section 19 of the Localism Act 2011, or

(c) section 5E(2) of the Fire and Rescue Services Act 2004;

and to perform, in respect of such draft orders, and in respect of subordinate provisions orders made or proposed to be made under the Regulatory Reform Act 2001, the functions performed in respect of other instruments and draft instruments by the Joint Committee on Statutory Instruments; and

(iii) To report on documents and draft orders laid before Parliament under or by virtue of:

(a) section 85 of the Northern Ireland Act 1998,

(b) section 17 of the Local Government Act 1999,

(c) section 9 of the Local Government Act 2000,

(d) section 98 of the Local Government Act 2003, or

(e) section 102 of the Local Transport Act 2008.

That, as proposed by the Committee of Selection, the following members be appointed to the Committee:

That the Committee have power to appoint a sub-committee and to refer to it any of the matters within the Committee’s terms of reference; that the Committee have power to appoint the Chairman of the sub-committee;

That the Committee have power to co-opt any member to serve on the sub-committee;

That the Committee and its sub-committee have power to send for persons, papers and records;

That the Committee and its sub-committee have power to appoint specialist advisers;

That the Committee and its sub-committee have power to adjourn from place to place;

That the Committee have leave to report from time to time;

That the reports of the Committee be printed, regardless of any adjournment of the House;

That the evidence taken by the Committee in the last session of Parliament be referred to the Committee;

That the evidence taken by the Committee or its sub-committee be published, if the Committee so wishes.

The Chairman of Committees (Lord Sewel): My Lords, I beg to move the first six Motions standing in my name on the Order Paper en bloc.

Lord Howell of Guildford (Con): The noble Lord will recall that on 26 March he kindly replied to a Question of mine relating to the setting up of an international relations standing committee of this House. In the light of what he answered in his Written Answer, what progress does he see being made on this issue?

The Chairman of Committees: I am happy to give the noble Lord the news that this afternoon the Liaison Committee is considering the very point that he has raised. I hope to be able to write to him in a matter of a few days with details about how the matter is being taken forward.

Motions agreed.

European Union Committee

Membership Motion

3.11 pm

Moved by The Chairman of Committees

That a Select Committee be appointed:

(1) To consider European Union documents deposited in the House by a Minister, and other matters relating to the European Union; The expression “European Union document” includes in particular:

(a) a document submitted by an institution of the European Union to another institution and put by either into the public domain;

(b) a draft legislative act or a proposal for amendment of such an act; and

(c) a draft decision relating to the Common Foreign and Security Policy of the European Union under Title V of the Treaty on European Union;

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The Committee may waive the requirement to deposit a document, or class of documents, by agreement with the European Scrutiny Committee of the House of Commons;

(2) To assist the House in relation to the procedure for the submission of Reasoned Opinions under Article 5 of the Treaty on European Union and the Protocol on the application of the principles of subsidiarity and proportionality;

(3) To represent the House as appropriate in interparliamentary cooperation within the European Union; That, as proposed by the Committee of Selection, the following members be appointed to the Committee:

That the Committee have power to appoint sub-committees and to refer to them any matters within its terms of reference;

That the Committee have power to appoint the Chairmen of sub-committees, but that the sub-committees have power to appoint their own Chairmen for the purpose of particular inquiries; that the quorum of each sub-committee be two;

That the Committee have power to co-opt any member to serve on a sub-committee;

That the Committee and its sub-committees have power to send for persons, papers and records;

That the Committee have power to appoint specialist advisers;

That the Committee and its sub-committees have power to adjourn from place to place;

That the Committee have leave to report from time to time;

That the reports of the Committee be printed, regardless of any adjournment of the House;

That the evidence taken by the Committee or its sub-committees in the last session of Parliament be referred to the Committee or its sub-committees;

That the evidence taken by the Committee or its sub-committee be published, if the Committee so wishes.

The Chairman of Committees (Lord Sewel): My Lords, I beg to move the seventh Motion standing in my name on the Order Paper.

Manuscript Amendment to the Motion

Moved by Lord Pearson of Rannoch

Leave out the sections relating to the membership of the Committee, and the power to appoint sub-committees and refer to them any matters within its terms of reference, and insert: “That the Committee have power to appoint up to two sub-committees, one of which shall deal with European Union

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constitutional affairs and one of which shall deal with European Union economic matters; that the membership of the Committee and its sub-committees be balanced between members who favour the United Kingdom leaving the European Union and those who favour staying in it;”.

Lord Pearson of Rannoch (UKIP): Noble Lords appear to be aware that in recent years I have regularly raised the balance, effectiveness and number of our European Union Select Committees before we agreed their appointment. For students of this important but perhaps refined subject, I last raised it on 16 May 2013 at col. 544 and on 12 June 2014 at col. 528.

As to balance, this proposed new committee appears to be just as Europhile as its predecessors. I do not pretend to know all their views, but of its 16 members I can detect only three who I would describe as mildly Eurosceptic and six who are among the most ardent Europhiles in your Lordships’ House. This is more important than usual in a year when we are approaching an EU referendum. Your Lordships’ other Select Committee reports are widely respected, and if our EU reports suffer from a Europhile slant, that will not be helpful to any fair outcome. I want to put the public on alert now, and I hope that I do not have to come back to this point too often in future.

I admit that the second part of my amendment, that our committees should be balanced between those who want to leave the EU and those who want to stay in, will not be easy to achieve. I put it down to underline what a Europhile place your Lordships’ House is when compared to public sentiment on this matter. In fact I can think of only perhaps a dozen of your Lordships who would be prepared to say publicly that we should leave the European Union whatever the outcome of the current negotiations. However, we should at least try to make our committees as balanced as we can, and at the moment we do not.

Our committees are there to hold the Government to account on the legislation that emerges from Brussels—that is what I am constantly told by noble Lords who favour the present arrangements. However, the trouble remains that that is all that these committees can do: they can only scrutinise, and the Government regularly ignore their findings.

I remind your Lordships of the scrutiny reserve, whereby successive Governments have promised not to sign up to any piece of legislation in Brussels if it is still being scrutinised by the Select Committee of either House of Parliament. Yet since July 2010, the Government have broken that promise 303 times in the Commons and 266 times in your Lordships’ House. Some 238 of those overrides were on measures being considered by both Houses. Each override means that a new EU law is being forced upon us without the consent of Parliament, because the EU juggernaut rolls on regardless. I hope the respected chairman of our EU Select Committee, the noble Lord, Lord Boswell, will not mind if I remind your Lordships of his disappointed interventions on that subject on 4 December 2014 at col. 1400 and on 17 December 2014 at col. 95. I do not know if he can reassure us now that, as a result, the scrutiny reserve is no longer broken.

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I fear that our EU Select Committees do not and cannot hold the Government to account in Brussels. Since 1996, up to last year, the Government themselves have objected to and forced to a vote in the Council of Ministers 55 new measures, and they lost the vote on every single one of them. I add that the situation is just as depressing in that democratic fig-leaf, the European Parliament. Of its 1,936 most-recent Motions, a majority of all UK MEPs voted against 576 of them, but 485 still passed—a failure rate of some 84%. So it does not seem that our Select Committee reports carry much weight there either. None of that should surprise us. The big idea behind the EU has always been that member states should be diminished in favour of the unelected bureaucracy, under the pretence that that would maintain peace in Europe, which was of course, in fact, always sustained by NATO, not Brussels—but that is still at the root of our powerlessness in the EU.

Finally, my amendment would reduce our EU committees from seven to three, freeing up four committees for other work. It is those other committees that are so widely and rightly respected by the public, and which we as a House are uniquely qualified to deliver, yet we are only being allowed three new ad hoc committees and have turned down requests from noble Lords for no fewer than 42. I refer your Lordships to HL Paper 127 from our Liaison Committee, which details all those 42 committees which we will now not have. I understand that we may be making progress on a committee on foreign affairs, which would be a step forward. However, noble Lords’ suggestions from within 21 other areas of our national life are not being adhered to—the House will not be given those committees and the British public will not have your Lordships’ wisdom upon them. I therefore propose that we have four fewer, somewhat pointless EU committees, and four more to draw on the vast array of your Lordships’ knowledge and experience. I beg to move.

Lord Foulkes of Cumnock (Lab): My Lords, I do not think that we should let the noble Lord get away with a caricature of the committee and its operation. I had the privilege of serving on the committee for the last three years and I found it very interesting. I also found it very interesting that, although Members who are not on the committee are entitled to attend, at no time did the noble Lord come along to sit in. In fact, not only can Members attend but they can ask questions. However, as I said, at no time did he take the opportunity to come. If he had done so, he would have found his caricature of the committee to be entirely wrong. Some of the people who I believed to be critical of the European Union were in fact very positive members of the committee and its sub-committees. I do not like to single out people but the noble Lord, Lord Lamont, who has a reputation for being very critical and might have us out of the European Union, was a very positive member of the committee.

We had regular sessions with the Minister for Europe, who incidentally did an extremely good job and answered our questions very well, but we put him under particular scrutiny. He came after European Council meetings, although we thought that it would have been better for him to appear before attending those meetings so that we could tell him what we thought this Parliament felt

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and he could represent those interests and our views at the meetings. It is interesting that the people who suggested that—I was one of them—are perceived to be more in favour of the European Union, but we wanted there to be more criticism.

I also wonder whether the noble Lord, Lord Pearson, has read any of our reports. Many, if not all, contain substantial criticisms of the UK Government and the European Union, and they make suggestions again and again about the way in which the European Union should improve. The suggestion that before people are appointed to a committee we should work out whether they are in favour of or against the European Union is, in my view, manifestly unfair and total nonsense. We would have a Star Chamber that you would have to appear before, saying whether you are in favour of or against the European Union. As we know, there is a whole range of views on the European Union in this Chamber, as there is elsewhere.

I think that what we have heard from the noble Lord is complete nonsense and I hope that it will be thrown out comprehensively.

Lord Bowness (Con): My Lords, I, too, want to speak against the acceptance of this amendment. Every year we hear from the noble Lord, Lord Pearson, his objections to the European Union Committee and every year he makes it quite clear that he does not understand how it works. He talks about the reputation of other Select Committees. Having been a member of the European Union Select Committee but being no longer a member and not proposed to be a member, I have to say to the noble Lord that the reputation of this committee is such that it is widely respected across the whole of the European Union in other member states and other member parliaments. He clearly does not appreciate the amount of work that is done, and the suggestion that the sub-committees could be reduced from the current six to the number that he proposes is manifestly ridiculous, given the amount of scrutiny work that has to be done on all the draft legislation that comes from the European Union.

The committee has two roles: one is to scrutinise the European Union and the second is to hold the Government to account. I remind your Lordships that the existing structure already provides for a sub-committee to deal with economic matters and that there is already a sub-committee dealing with institutional and constitutional matters, as well as the Select Committee itself. As for endeavouring to divide your Lordships’ House on making an early judgment as to whether somebody is in favour of or against the European Union or a particular measure, it is clear that that proposal is absolutely unworkable.

We have a reputation for producing objective reports, which, as I said, are referred to across the European Union. To throw to the winds one of the most valuable institutions and pieces of work that your Lordships’ House is engaged in would be positively unfortunate to say the least, and I hope that the House will reject this amendment.

Lord Stoddart of Swindon (Ind Lab): My Lords, I congratulate the noble Lord, Lord Pearson, on once again drawing attention to the overrepresentation of

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people who are very much in favour of our membership of Europe on the European Union Committee, to the detriment of those who believe otherwise.

I thought, in fact, that the noble Lord, Lord Pearson, was very restrained. He did not take the opportunity to point out that, at the last election, 3.9 million people, by voting for UKIP, voted against our membership of the European Union. They voted for UKIP, I imagine, because UKIP was the only party putting forward the proposal that we should withdraw from the European Union. Those 3.9 million people obviously voted to support that proposition. If they did not, what on earth else were they doing? The Labour Party is in favour of our membership of Europe. The Conservative Party is in favour of our membership of Europe. The Liberal party is in favour of our membership of Europe.

Noble Lords: Hear, hear.

Lord Stoddart of Swindon: They say, “Hear, hear”, so they are confirming what I am saying.

All the other political parties that it was possible to vote for were in favour of remaining in Europe; UKIP was the only one saying that we should come out. Therefore, whatever objections noble Lords may have to my saying it, it is reasonable that one would expect that people who voted UKIP wish to come out of the EU. Indeed, there are many people—including people belonging to the Labour Party, the Conservative Party and even some in the Liberal party—who would vote to come out.

As I said, the noble Lord, Lord Pearson, was very measured. He did not take the opportunity to point out that, in this House, there is now a grave discrepancy of UKIP noble Lords. On the basis of the 3.9 million votes cast for UKIP, it would be entitled to 80 seats in this House. In fact, it has none, except for those who have left other parties to take on the UKIP cause. It is quite true that UKIP has only one Member in the House of Commons, but it is entitled to much better representation in this House—let us bear in mind that the Liberal Democrats, with only 2.9 million votes, have only eight Members in the House of Commons and 101 Members in this House. I think that the House needs a little balancing. I hope that the Prime Minister will take that into account when making further nominations to this House.

Lord Elton (Con): I served for a brief and happy time on Sub-Committee B of the European Union Committee, and we are talking about doing away with it. Under the skilful chairmanship of my noble friend Lady O’Cathain, we objected in strenuous terms to a number of regulations that were sent from Europe on the understanding that, if a stated number of other countries did the same, the Commission would have to think again. If that were exceeded, the Commission would have to lay a new order.

I dare say that my question will put into context the efficacy of these committees. On how many occasions have similar objections actually been acted on by the Government and received a change of policy from the European Council?

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3.30 pm

Lord Flight (Con): My Lords, I had the privilege of sitting on the EU Economic and Financial Affairs Sub-Committee for four years. All the members got on extremely well and produced some very good papers. But there was quite a strong underlying Europhile bias to it, excellently chaired by the noble Lord, Lord Harrison, though it was. To completely neglect the point that has been raised is wrong, but I would also say that from my experience there was a fairly open discussion, even if people’s starting points were predominantly on one side.

The Chairman of Committees: My Lords, as we have seen over recent weeks, there are few certainties in politics, so it is reassuring to know that one continues to exist: the annual criticism by the noble Lord, Lord Pearson of Rannoch, of the establishment and composition of the EU Select Committee and its sub- committees. I will deal with the points that he raised.

The House considered the number and scope of the EU Committee and its various sub-committees in a debate on a Liaison Committee report on 26 March 2012. The noble Lord may wish to write to the Liaison Committee—I offer him this invitation—if he is really serious about making substantive proposals on how the EU Select Committee should address the various issues that it has to consider. I say “substantive proposals” rather than just flag waving and cheering from the side from time to time.

However, in the context of reducing the number of sub-committees, I believe that this House greatly benefits from the various sub-committees and the expertise that they bring to bear on a wide range of issues, including home affairs, justice, agriculture, fisheries and business. A decision to reduce the capacity to scrutinise the whole range of EU draft legislation, certainly coming from an acknowledged critic of the EU, seems to be utterly perverse. I fail to understand the logic in the noble Lord’s argument. The point about composition, the Star Chamber and having to swear before you get on to a committee that you are in favour of or against continued British membership of the EU, is utterly wrong and nonsense, and I am sure that the House agrees. The point is that we make nominations to Select Committees based on the views taken by individual parties on the worth of individual Members of this House. That is the way it should remain.

On the issue about the future of Sub-Committee B, I am at a loss. I have not the slightest knowledge—and I do not think that it is true although I will check—of any attempt to abolish Sub-Committee B. It does important work. A recent report, Women on Boards, received strong and supportive comments, not just in this country but elsewhere. The sub-committee will, I am sure, continue with its good work. The noble Lord asked for a list of examples of how recommendations from our EU Select Committee and its various sub-committees have affected policy. I can think of some, and I will write to the noble Lord with a fuller list. However, I can certainly remember from my experience that the basic reform of the common fisheries policy was led by a sub-committee of the EU Committee of this House. I, of course, happened to be the chair of that sub-committee.

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Lord Pearson of Rannoch: My Lords, on the last point made by the Chairman of Committees, I understand that in fact the change to the common fisheries policy came from a television series by Mr Fearnley-Whittingstall that was very hard-hitting.

I am very grateful to all noble Lords who have spoken, and in particular to the noble Lords, Lord Foulkes and Lord Bowness. I would say to the noble Lord, Lord Foulkes, that if these EU committees are critical of things that are going on in the EU, it does not seem to make any difference. I do have to say to the noble Lord, Lord Bowness, that from 1992 to 1996 I did in fact serve on your Lordships’ European Union Select Committee and I even employed a young man who is now an eminent Member of the other place to wade through the papers for me so that when I went to the committee meetings I could see the bits that had been outlined in yellow and concentrate on them. Over the whole of the four or five years that I served on the Select Committee, I have to say that I did not see through it—I did not see that it was a waste of time—and I regret that.

As to the question put by the noble Lord, Lord Elton, I can answer that by saying that virtually no yellow card has made any difference whatever, and of course it will not. As to the red card, it really will not be much use unless we are able to repeal legislation that has already gone through instead of just looking at new legislation as it comes gushing forth.

I have to repeat that since 1996 some 55 votes have been forced in the Council of Ministers by the United Kingdom Government and they have lost every one of them. That is quite a telling point and casts doubt on the position not only of our Select Committees but of the Government themselves. I am disappointed that the noble Lord, Lord Boswell, did not contribute to the debate because I was hoping that he could reassure your Lordships that the scrutiny reserve is now occasionally respected by the Government—

Lord Boswell of Aynho (Non-Afl): My Lords, I am most grateful to the noble Lord for allowing me to intervene. I would invite him to exercise a degree of patience for a week or two, when once again we will be presenting the annual report of my committee—and, by inference, that of its sub-committees—for the attention of the House. He will then, as he has in the past, have the opportunity to debate the report. I hope very much that on this occasion he will engage with it.

Lord Pearson of Rannoch: I am grateful to the noble Lord for his most helpful contribution and I look forward to the result.

Of course I am not going to press this to a vote. All I can say is that I hope that our debate has done something to rectify the situation for the next Session of Parliament. Again, I am most grateful to noble Lords who have spoken and I beg leave to withdraw the amendment.

Amendment to the Motion withdrawn.

Motion agreed.

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House Committee

Hybrid Instruments

Information

Liaison

Parliamentary Office of Science and Technology (POST)

Privileges and Conduct

Procedure

Refreshment

Science and Technology

Secondary Legislation Scrutiny

Standing Orders (Private Bills)

Works of Art

Membership Motions

House Committee

That a Select Committee be appointed to set the policy framework for the administration of the House and to provide non-executive guidance to the Management Board; to approve the House’s strategic, business and financial plans; to agree the annual Estimates and Supplementary Estimates; to supervise the arrangements relating to financial support for Members; and to approve the House of Lords Annual Report;

That, as proposed by the Committee of Selection, the following members be appointed to the Committee:

That the Committee have power to send for persons, papers and records;

That the Committee have leave to report from time to time;

That the reports of the Committee be printed, regardless of any adjournment of the House.

Hybrid Instruments

That a Select Committee be appointed to consider hybrid instruments and that, as proposed by the Committee of Selection, the following members together with the Chairman of Committees be appointed to the Committee:

That the Committee have power to send for persons, papers and records;

That the reports of the Committee be printed, regardless of any adjournment of the House; and

That the evidence taken by the Committee be published, if the Committee so wishes.

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Information

That a Select Committee be appointed to consider information and communications services, including the Library and the Parliamentary Archives, within the strategic framework and financial limits approved by the House Committee;

That, as proposed by the Committee of Selection, the following members be appointed to the Committee:

That the Committee have power to send for persons, papers and records;

That the Committee have leave to report from time to time.

Liaison

That a Select Committee be appointed to advise the House on the resources required for select committee work and to allocate resources between select committees; to review the select committee work of the House; to consider requests for ad hoc committees and report to the House with recommendations; to ensure effective co-ordination between the two Houses; and to consider the availability of members to serve on committees;

That, as proposed by the Committee of Selection, the following members together with the Chairman of Committees be appointed to the Committee:

That the Committee have power to send for persons, papers and records;

That the Committee have power to appoint specialist advisers;

That the Committee have leave to report from time to time.

Parliamentary Office of Science and Technology (POST)

That, as proposed by the Committee of Selection, the following Lords be appointed to the Board of the Parliamentary Office of Science and Technology (POST):

L Haskel, L Oxburgh, E Selborne, L Winston.

Privileges and Conduct

That a Committee for Privileges and Conduct be appointed and that, as proposed by the Committee of Selection, the following members together with the Chairman of Committees be appointed to the Committee:

That the Committee have power to appoint sub-committees and that the Committee have power to appoint the Chairmen of sub-committees;

That the Committee have power to co-opt any member to serve on a sub-committee;

That the Committee have power to send for persons, papers and records;

That in any claim of peerage, the Committee shall sit with three holders of high judicial office, who shall have the same speaking and voting rights as members of the Committee;

That the Committee have leave to report from time to time;

That the reports of the Committee be printed, regardless of any adjournment of the House;

That the evidence taken by the Committee or its sub-committees in the last session of Parliament be referred to the Committee or its sub-committees; and

That the evidence taken by the Committee or its sub-committees be published, if the Committee so wishes.

Procedure

That a Select Committee on Procedure of the House be appointed and that, as proposed by the Committee of Selection, the following members together with the Chairman of Committees be appointed to the Committee:

That the Committee have power to appoint sub-committees and that the Committee have power to appoint the Chairmen of sub-committees;

That the Committee have power to co-opt any member to serve on the Committee or a sub-committee;

That the Committee and its sub-committees have power to send for persons, papers and records;

That the Committee and its sub-committees have power to appoint specialist advisers;

That the Committee and its sub-committees have power to adjourn from place to place;

That the Committee have leave to report from time to time;

That the reports of the Committee be printed, regardless of any adjournment of the House;

That the evidence taken by the Committee or its sub-committees in the last session of Parliament be referred to the Committee or its sub-committees;

That the evidence taken by the Committee or its sub-committees be published, if the Committee so wishes.

Secondary Legislation Scrutiny

That a Select Committee be appointed to scrutinise secondary legislation.

(1) The Committee shall, with the exception of those instruments in paragraphs (3) and (4), scrutinise—

(a) every instrument (whether or not a statutory instrument), or draft of an instrument, which is laid before each House of Parliament and upon which proceedings may be, or might have been, taken in either House of Parliament under an Act of Parliament;

(b) every proposal which is in the form of a draft of such an instrument and is laid before each House of Parliament under an Act of Parliament,

with a view to determining whether or not the special attention of the House should be drawn to it on any of the grounds specified in paragraph (2).

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(2) The grounds on which an instrument, draft or proposal may be drawn to the special attention of the House are—

(a) that it is politically or legally important or gives rise to issues of public policy likely to be of interest to the House;

(b) that it may be inappropriate in view of changed circumstances since the enactment of the parent Act;

(c) that it may inappropriately implement European Union legislation;

(d) that it may imperfectly achieve its policy objectives;

(e) that the explanatory material laid in support provides insufficient information to gain a clear understanding about the instrument’s policy objective and intended implementation;

(f) that there appear to be inadequacies in the consultation process which relates to the instrument.

(b) draft orders under sections 14 and 18 of the Legislative and Regulatory Reform Act 2006, and subordinate provisions orders made or proposed to be made under the Regulatory Reform Act 2001;

(c) Measures under the Church of England Assembly (Powers) Act 1919 and instruments made, and drafts of instruments to be made, under them.

(4) The Committee shall report on draft orders and documents laid before Parliament under section 11(1) of the Public Bodies Act 2011 in accordance with the procedures set out in sections 11(5) and (6). The Committee may also consider and report on any material changes in a draft order laid under section 11(8) of the Act.

(5) The Committee shall also consider such other general matters relating to the effective scrutiny of secondary legislation and arising from the performance of its functions under paragraphs (1) to (4) as the Committee considers appropriate, except matters within the orders of reference of the Joint Committee on Statutory Instruments.

That, as proposed by the Committee of Selection, the following members be appointed to the Committee:

That the Committee have power to send for persons, papers and records;

That the Committee have power to appoint specialist advisers;

That the Committee have leave to report from time to time;

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That the reports of the Committee be printed, regardless of any adjournment of the House;

That the evidence taken by the Committee be published, if the Committee so wishes.

Standing Orders (Private Bills)

That a Select Committee on the Standing Orders relating to private bills be appointed and that, as proposed by the Committee of Selection, the following members together with the Chairman of Committees be appointed to the Committee:

That the Committee have power to send for persons, papers and records;

That the reports of the Committee be printed, regardless of any adjournment of the House;

That the evidence taken by the Committee be published, if the Committee so wishes.

Works of Art

That a Select Committee be appointed to administer the House of Lords Works of Art Collection Fund; and to consider matters relating to works of art and the artistic heritage in the House of Lords, within the strategic framework and financial limits approved by the House Committee;

That, as proposed by the Committee of Selection, the following members be appointed to the Committee:

That the Committee have power to send for persons, papers and records;

That the Committee have leave to report from time to time.

Motions agreed.

Cities and Local Government Devolution Bill [HL]

Second Reading

3.39 pm

Moved by Baroness Williams of Trafford

That the Bill be now read a second time.

The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Williams of Trafford) (Con): My Lords, it is a pleasure to introduce the first Bill to receive its Second Reading in this House under this Parliament. It implements our manifesto commitments to allow cities and areas outside London to reach their economic potential. This Bill helps us to deliver on the promises we made that, if we were

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returned to government, there would be a clear economic plan and a brighter, more secure future for the whole country. Last week, we had an excellent and lively debate on the measures contained in the gracious Speech, including those in the Cities and Local Government Devolution Bill.

When speaking on the steps of Downing Street on the Friday after the election, the Prime Minister referred to closing the decades-old economic gap between north and south. For many years, under Governments of all political colours, our economy has become imbalanced and London has come to dominate more and more. In 2010, through our programme of decentralisation, we began to address this issue. We supported the development of local enterprise partnerships, concluded city deals with 27 cities, and took £12 billion out of Whitehall and put it in the hands of local people through growth deals, giving local areas more control to drive their own growth. In particular, in November 2014, the Government agreed a devolution deal with Greater Manchester, which will give local people greater control over their economy and powers over transport, housing, planning and policing. Greater Manchester will also gain new powers to support business growth and skills, and to help join up health and social care budgets.

In the last five years, we have been working with many partners—in business, across the political spectrum, and up and down the country—to move towards a more balanced economy. Two hundred years ago, when the country was at the height of the Industrial Revolution, Manchester was “Cottonopolis”, Liverpool’s ports welcomed ships from around the world and Birmingham was at the forefront of creative endeavour, registering three times as many patents as any other British town or city. But that economic diversity and strength was undermined by more than a century’s worth of power and decision-making being centralised in London. For decades, central government has made the rest of the country conform to a Whitehall template. The Bill calls time on that. Here, I pay tribute to three noble Lords in particular, although there are many others besides, from all political parties: the noble Lords, Lord Shipley and Lord Adonis, and my noble friend Lord Heseltine. They have been working hard on this agenda over the last decade, and, in the case of my noble friend Lord Heseltine, for three decades.

This is a devolutionary Bill that puts in place a legal framework enabling us to decentralise powers to our cities and counties, and across the country. The framework will allow us to ramp up what we started in the last Government, reversing 150 years of centralisation whereby powers were relentlessly drawn into Whitehall and London became ever more dominant. The framework will enable us to implement the Greater Manchester city deal and similar bespoke deals in other cities.

Decentralisation is the key to achieving economic growth and unlocking the potential for economic success in our cities. It enables places to take greater control over and responsibility for the key things that make it work. Any one-size-fits-all model is destined for failure. Every city and council is different. Through the decentralisation that the Bill will enable, each city will be empowered to forge its own path, to play to its own

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strengths and to find its own creative solutions to the particular challenges that they face. The power of decentralisation is to bring about change—to be the foundation of securing long-term sustainable growth, applying equally to towns and counties.

To be successful, decentralisation must involve not only devolving powers and budgets but having in each place the necessary leadership, governance and accountability so that powers are exercised properly and effectively, for the benefit of all. Where major powers are devolved, the Government are clear that there needs to be a single point of accountability. People need to know who is taking the decisions and whom to turn to if things go wrong.

Mayoral governance is an internationally proven model of governance for cities. Hence, as the Chancellor has made clear, where a significant suite of powers is being devolved to areas, metro mayors must be elected by the people. We will hand powers from the centre to those cities that choose to have a metro mayor, giving greater control over such things as transport, housing, skills and healthcare. A metro mayor may also, on a case-by-case basis, as in Greater Manchester, be given the powers of a police and crime commissioner. Cities will have the levers needed to grow their local economy and to make sure that the people in the city can keep the rewards.

Our Bill therefore puts in place not only the legal framework for devolving powers, but the framework to ensure that the strong and accountable governance necessary for devolution is in place. The Bill enables a mayoral combined authority to be a precepting body, and for a precept to be set to fund mayoral functions. Requirements relating to the setting of mayoral budgets may be specified by order. A combined authority’s other costs—those not incurred by the metro mayor—will be met from the budgets of the local authorities in its area. The Bill will also allow a combined authority to be given powers and to borrow money for particular purposes, if all the local authorities in its area agree.

The Bill allows, by more straightforward processes, the local governance of a place to be simplified. For example, where powers are devolved to one or more counties, putting in place the necessary governance may include making council mergers, moves to unitary structures, or simplifying the democratic representation with fewer councillors. This will be the case whether or not there is an elected metro mayor for the area.

The crucial point is that all the Bill’s provisions are to be used in the context of deals between government and places. Nothing is being imposed. Where there is a request for an ambitious devolution of a suite of powers to a combined authority, there must be a metro mayor, but no city will be forced to have a mayor and the powers that come with it. No county will be forced to make any changes of governance and to have the powers that can come with such governance changes.

I, like many noble Lords, started my political life in local government. I want to improve my local area and to see it develop and grow. The council that I sat on for 13 years will be part of the trailblazer devolution deal, reclaiming the power to decide its future. I hope that it will be the first of many, and that the Bill enables that

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to happen. With the Cities and Local Government Devolution Bill we will implement the manifesto commitments to,

“devolve far-reaching powers over economic development, transport and social care to large cities which choose to have elected mayors”,

and to,

“deliver the historic deal for Greater Manchester”.

I beg to move.

3.47 pm

Lord McKenzie of Luton (Lab): My Lords, I thank the noble Baroness, Lady Williams, for her clear introduction of the Bill and for facilitating our briefing meeting last week. It is a short Bill—just 14 clauses—which of itself devolves nothing, but its framework lays the groundwork for outcomes that could be of great constitutional significance. I say “could” because it depends on how the raft of powers in the Bill that accrue to the Secretary of State are deployed in practice. It also depends on the appetite and capacity of local authorities to engage.

As it stands, the Bill is a blank canvas. As we have heard, it could, with agreement, include devolution to a combined authority of seemingly any local authority function and any public authority function—including that of Ministers and government departments—exercisable in relation to the authority’s area. It could involve the conferring of a general power of competence on the combined authority. Further, as we heard, it enables changes by regulation to the constitution, membership, structure and boundaries of local authorities for devolution deals where a combined authority might not be appropriate.

We support the boundaries of this framework, but our task in Committee will be to probe the Government’s approach and the extent and manner in which it is intended these considerable powers be implemented and over what timescale. But we also recognise that it is not just about government; it is for local authorities, in the words of the City Growth Commission,

“to raise their game, building governance, policymaking and evaluation capacity”,

and to develop their own vision for their areas.

We know that there are compelling reasons why we should support and encourage the devolution of greater powers and funding away from the centre and towards local authorities and communities. This agenda is not new. It has long been recognised that we have a high degree of centralisation in our system of government which is stifling initiative and creativity and holding back growth and regeneration. There have been a range of policies and initiatives over the years which have sought to address this in one way or another: UDCs, City Challenge, New Deal for Communities, RDAs, LEPs and the regional growth fund. We welcome the fact that the architects of some of these are with us this afternoon. However, the economic imperative—the need to enhance and sustain growth and reconfigure and join up services in the face of more cuts—and the democratic benefit which can flow from people having more power in their localities and communities require us to now address the benefits of devolution on a more profound and sustained basis.

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Discussion hitherto has generated the concern that the Government’s focus in practice was only for devolution to our major northern cities—the city regions or metros. This is a debate driven very much by the City Growth Commission, which has recognised their potential to harness the benefits of agglomeration, connectivity and improved governance. It points to the success of London although, as we know from the London Councils briefing, London councils are seeking, not unreasonably, further devolution themselves.

We support the devolution of powers to great cities such as Manchester, Leeds, Sheffield and Liverpool, and not just because these are Labour led. We want to see devolution to every part of the country, not just to other cities or metros but to counties as well—not just to Tyne and Wear and the East Midlands but to Bristol, Southampton, Norfolk and Norwich—and not just to urban areas but to rural and coastal areas, too. The Bill as it stands enables this wider devolution and has been welcomed by a number of commentators, including the LGA. As I have said, it has our broad support, although we will want to see what this means in practice.

The wide scope of the Bill raises the question of how it is potentially to be delivered. There are currently five combined authorities and suggestions that there is active consideration of four more, covering Derbyshire, Nottinghamshire, the Tees Valley and Birmingham and the Black Country. The Bill is likely to whet the appetite of others, and we hope that it does. We have no idea, of course, how many proposals might emerge under Clause 10. Obviously, this cannot all be done at once, but perhaps the Minister will tell us what the strategy for delivery is and reassure us that it will not be a piecemeal approach. Presumably, progress does not rest just on who catches the Chancellor’s eye. Is there any presumption of metros first? How will the Government seek to ensure that counties in particular do not fall behind?

We should take the opportunity today to congratulate Greater Manchester on its innovative agreement with the Treasury. The 10 local authorities involved have a long record of collaboration, characterised by consistent leadership and hard work. That work has delivered the opportunity of a range of powers over a housing investment fund, transport, business support, strategic planning skills, complex dependency, the Work Programme and opportunities to integrate health and social care across the combined authority area—the tools needed to develop programmes that address local needs and develop a new “place-based” partnership with government.

We support the devolution and integration of health and care services but recognise from the MoU attached to the Manchester agreement that the issues are not straightforward. We would not want to see a disruptive structural reorganisation and are cautious about some areas such as workforce planning, research and commissioning of specialised services. There is also a need to test where the buck ultimately stops in the event of major disruption to services—with the Secretary of State or with the combined authority. We need also to be mindful of the briefing, received just today, by the RCN.

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As we have heard, the Bill also enables for the first time a combined authority to have an elected mayor who by virtue of that office chairs the combined authority, and with an obligation to appoint a deputy. The Secretary of State can by order require that any function of the combined authority can be carried out only by the mayor, and to these can be added the role of the PCC. We will express our concerns that this could lead to a very substantial concentration of power in the hands of one individual—mandatory scrutiny arrangements notwithstanding—and we will take time in Committee to probe the potential boundaries of these arrangements.

The position of elected mayor still requires some clarification from the Minister, our earlier exchange at Questions notwithstanding. I think we are clear that the Bill does not appear to make it a precondition that the combined authority must have an elected mayor in order to gain the additional functions covered in the draft legislation, yet the rhetoric of Ministers, particularly the Chancellor, has suggested otherwise. He said in a recent speech:

“So with these new powers for cities must come new city-wide elected mayors who work with local councils. I will not impose this model on anyone. But nor will I settle for less”.

We acknowledge the importance of clear leadership and accountability in driving through reforms to stimulate economic growth but question why there should be only one acceptable leadership model.

At our briefing meeting, the Minister suggested that matters might be more flexible than this. To an extent she has confirmed that again today, but can we have it on the record that a city region can have the powers under the Bill without having an elected mayor? What about the existing combined authorities? Does the Minister accept that, given that all bar one of the cities holding a compulsory referendum last time rejected elected mayors, the insistence on having one could be a barrier to the devolution process? Of course, once the position of elected mayor is accepted, there is no going back. The prospect of an elected mayor taking on some or all of the duties of a PCC would seem to be an admission of failure. Where does that leave situations where the boundaries of the combined authority and the remit of the PCC are not co-terminous?

The opportunities and challenges that the Bill presents will be heavily dependent on funding arrangements, not only the specific arrangements for individual deals but the continuing underlying funding for local government. I do not propose today to revisit the sorry saga of unfair cuts visited by the previous Government—a coalition of Tories and Lib Dems, we should recognise —on our most deprived communities, which we know are to continue, except to say that devolution must not be a cynical route to unloading responsibilities on local authorities without proper funding. Of course, the previous Government have history on this. The Bill provides, as we heard, for levying powers of a combined authority except for mayoral functions, in respect of which a combined authority becomes a precepting authority. This would appear to lead to situations where the same function is funded differently, depending on whether or not it is a mayoral function. We will look to better understand the consequences of this in Committee.

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There is no general provision in the Bill whereby sources of revenue accrue directly to local authorities as part of a devolution process, so far as I can see. In formulating our plans, we have proposed the retention of all business rate growth but it looks from the Manchester agreement that these matters will be negotiated on a case-by-case basis. In his No Stone Unturned: In Pursuit of Growth report, the noble Lord, Lord Heseltine, cautioned against what he called the “penny packets” approach to devolution—that is,

“Parcels of cash attached to specific projects, each with their own particular objectives, timetable and requirements”.

Does the Minister accept this caution and can she tell us what the Government’s approach is in this regard? What is the size of their ambition and what is the measure of central public authority funding potentially available in this Parliament? Indeed, what funding streams are available?

Time marches on. There is much else for Committee, including mandatory scrutiny, which we support; the electoral process for elected mayors, which seems to have absorbed the drafters of the Bill; and the level of parliamentary scrutiny. But the Bill opens up huge opportunities and we will play our part in encouraging local government to take maximum advantage.

3.59 pm

Lord Shipley (LD): My Lords, I welcome the Second Reading of the Bill and I am grateful to the Minister for her kind comments earlier. I welcome the Bill not because everything in it is right but because it represents a further and very important stage in achieving greater decentralisation and fiscal devolution within England, through which growth can be increased outside London faster and local government can make more effective use of public money by joining up service delivery. There will be a number of contributions today from these Benches and I welcome that, because there is a wealth of practical experience here to draw on. Some colleagues who are not able to speak today will be speaking in Committee.

The Minister was right to say that the record of the last Government in encouraging decentralisation was impressive. It was, however, only a start. Crucially, there is now a much clearer understanding that you cannot run the whole of England from London, so I support the principle behind the Bill. It will decentralise power out of Whitehall and enable fiscal devolution. Because it is an enabling Bill, it means that one size need not fit all and that it can be voluntary for combined authorities or councils to propose schemes that are generated locally and have some local ownership.

In recent months, we have seen a host of reports as diverse as No Stone Unturned: In Pursuit of Growth by the noble Lord, Lord Heseltine, from the City Growth Commission, from the Independent Commission on Local Government Finance, the Independent Commission on Economic Growth and the Future of Public Services in Non-Metropolitan England and the London Finance Commission. There have also been a host of reports from think tanks, in particular the ResPublica reports—not least Devo Max-Devo Manc—and work done by IPPR and the Local Government Association, of which

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I am a vice-president. There has also been a huge amount of work done by the English core cities network. All that work points in the same direction.

It is 40 years ago that I was first elected to Newcastle City Council, and I well remember the turf wars between that council and Tyne and Wear County Council. They competed too much and it did not help that their memberships were separate rather than shared. The met counties, as we know, were abolished some 30 years ago, but problems of integrating with the wider region remained, not least in strategic planning and transport. Then, in 2004, we had the referendum in the north-east on creating a regional assembly. On a turnout of half the electorate, only 22% voted yes. It failed despite the best efforts of a number of Members of your Lordships’ House, not least the noble Lord, Lord Prescott, because it had no real powers and was seen as a talking shop and another layer of government, when power would still in reality reside in Whitehall. I think that things have changed. The north-east of England did not see the need then, but, given the further devolution planned for Scotland, that is no longer the case. This Bill gives the scope that we need. It is the next essential stage without which Cornwall, for example, or the existing combined authorities would not be able to go any further in securing devolution.

What of my own party’s position? Our general election manifesto said that we would:

“Build on the success of City Deals and Growth Deals to devolve more power and resources to groups of Local Authorities and Local Enterprise Partnerships … Establish a Government process to deliver greater devolution of financial responsibility to English Local Authorities, and any new devolved bodies in England, building on the work of the Independent Commission on Local Government Finance”.

We also said:

“Any changes must balance the objectives of more local autonomy and fair equalisation between communities. In some areas of England there is an even greater appetite for powers, but not every part of the country wants to move at the same speed and there cannot be a one-size-fits-all approach”.

We therefore said that we would,

“introduce Devolution on Demand, enabling even greater devolution of powers from Westminster to Councils or groups of Councils working together—for example to a Cornish Assembly”.

We now need local government to propose workable structures as central government accepts that one size does not fit all—both of which, of course, the Bill recognises and enables.

I may have given the impression so far in my contribution that we are debating a perfect Bill at Second Reading and that nothing needs to change, or be further defined or examined. In my view, that is far from the case. There are issues that we need to examine closely when we reach Committee in a fortnight’s time. The first relates to democratic legitimacy: that is, a new structure of local governance, and public support for that structure. I recognise that in the case of Greater Manchester it was made clear in the Conservative Party manifesto that a Conservative Government would,

“legislate to deliver the historic deal for Greater Manchester”.

However, it is also the case that most electors in Greater Manchester did not vote for the Conservative Party in the general election. I have come to the conclusion that it must always be right to test proposed

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constitutional changes such as these in a local referendum. We must return to this issue in a fortnight’s time when we start Committee.

Secondly, when elections for the mayor take place—assuming the Bill becomes an Act—there will be a direct connection with the ballot box at least for the person entrusted with the huge powers an elected mayor will have. However, the range of powers is potentially so vast that I doubt one person can do it all, which means in practice that much will be delegated. We need to think very carefully about running policing, social care and health, strategic planning, housing, skills, transport, economic development and regeneration all through one person.

Thirdly, in London there is an assembly with powers of scrutiny over the mayor. Something similar is needed as part of the Bill. I noted the comments of the Chancellor of the Exchequer on May 14 in Manchester, when he said that the metro mayor would be,

“a powerful point of accountability”,

because they would be:

“A person vested with the authority of direct election”.

However, he also said that,

“the Manchester model of devolution is not like London. We haven’t created a new Assembly here. We’ve built on the excellent cooperation you’ve established with your combined authority, as you asked me to do”.

I am not convinced that this is enough. We run the risk of creating a one-party state in which one party controls the metro mayor, the metro mayor’s appointment of the deputy, the combined authority—at least in terms of having a majority of seats—and the scrutiny of the mayor and of the combined authority. This concentration of power in the hands of a very limited number of people, when this Bill is all about devolving power, seems to me to need some urgent revision.

I also have some questions around the voting system and what the preferred voting system should be, and again around the powers to precept and what in practice that will mean when applied. I hope that we can look at those further in Committee. I am an advocate of proportional representation in local government, and it has occurred to me that this might be the moment for your Lordships’ House to give some further thought, given that it applies in Scotland, to the desirability of making local government elections by proportional representation. If we did, some of the problems that I have identified could be solved.

To conclude, the principle of enhanced devolution as proposed in the Bill is most welcome. It is the detailed set of proposals that we need to spend time examining now in Committee.

4.09 pm

The Earl of Listowel (CB): My Lords, I declare my interest in the register in property development. It is also perhaps worth reminding the House that I am treasurer of the All-Party Parliamentary Group for Children.

I hesitate somewhat to take part in this debate as I am afraid I may be straying where angels fear to tread. However, I am so concerned about the issues around housing supply in this country, particularly social

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housing for our poorest families, and our need for key worker housing so that we have the excellent teachers and social workers who can intervene with these families and help to turn their lives around, that I feel I need to speak. In principle, I very warmly welcome what the Government propose. It seems quite evident that if we strengthen the north of England and its economies, there will be less burden on housing in London and the south-east, and we will relieve the strain that some of our poorest families experience. The principle of delegation of powers within this Bill also seems very welcome.

My concern somewhat echoes that which the CBI raised in its briefing: certain issues need a strategic authority strong enough to balance many vociferous and powerful opposing forces. In particular, the CBI talked about transport. I am concerned that in housing supply it is important to consult and think hard about local residents’ concerns. It is very important to think about the environment. However, it is also important to weigh up with that people’s need for social and key worker housing. That can be such a difficult issue for an institution to resolve. Whatever new authorities we establish to process these decisions, they need to be robust enough in terms of residential development. Local people, particularly those who own their own homes, understandably feel very concerned about any prospect of development in their local area. It can be very difficult for local politicians to put the other side, about the need for new homes for social or key worker housing. Local media may feel very much that they must put the case that most concerns local people. Whatever authority tries to balance up the interests in that area, it will have a very difficult job to do and needs to be robust enough to do it. I hope the Minister can reassure me that the institutions that she seeks to establish through the Bill will be robust enough to make the right decisions in all our interests when these things come up. Furthermore, I urge the House to look at this Bill as an opportunity to think about how we can increase the supply of affordable homes, key worker housing and social housing in this country.

I pay tribute to the noble Lord, Lord Heseltine. Some time ago, with the All-Party Parliamentary Group on Homelessness and Housing Need, I visited Walthamstow housing action trust. I hope my memory serves me correctly, but the residents there told me that they had been rather late to apply for housing action status. I think they actually approached the noble Lord with some rubble—the masonry that fell from their buildings. Anyway, they were very grateful to be granted that special status with all the opportunities to influence their crumbling housing estate and change it for the better. I pay tribute to the noble Lord for what he did for them in particular.

If I may highlight the issues around homelessness, there were 90,000 homeless children in Britain in November, as recorded by Shelter. There were more than 2,000 families living in bed-and-breakfast accommodation in England last June—and that is on the increase. In Wales and Scotland, the numbers of such families are decreasing but in England they are on the increase. I visited the University of East London in Stratford recently to talk with four academics undertaking some research around housing and perinatal

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mental health. We discussed the recent report from the London School of Economics looking at perinatal mental health which highlighted the fact that failing to meet the perinatal mental-health needs of mothers cost the nation £8 billion per year. That is £10,000 per birth. The bulk of that extraordinary cost—some 72% of it—arises from the fact that when mothers are depressed or suffering postnatal depression their relationship with their child is disturbed and that child then fails to thrive, which influences their later development.

The academics are looking at how housing can influence the mental health particularly of mothers around birth. There is evidence from Chicago on the impact of homelessness on the mental health of mothers. Visiting with health visitors in Redbridge and Waltham Forest, I have seen mothers in appalling conditions, living in the most tragic circumstances, in overcrowded houses in multiple occupation, sharing facilities with several other families. We walked in and found the door left open and a mother with a baby only a few weeks old living in that very unsatisfactory situation. It really reinforces to me why we need to do all we can to improve the supply of key worker and social housing.

Not so long ago, I spoke to the head teacher of a primary school in Kings Cross who told me that one of her best teachers had recently been in her office in tears because she had to move out of London to establish her family and have a home that she could afford. Again and again, I hear from our key workers that, when they have gained experience in London and the south-east, they move up north to establish their families. This really has an impact on issues such as the number of agency staff employed by the National Health Service.

The issue of immigration is so much on our minds. There is perhaps nothing that causes more tension in communities than the fact that there is a shortage of housing, so that people in our country have to compete with immigrants over housing supply. That should not be necessary; we should have built enough housing so that we can accommodate both the immigrants we need and those who live in this country. It is a red rag to a bull. Margaret Hodge MP has raised this issue in the past, and the Governor of the Bank of England recently highlighted how supply of housing impacts on the security of the economy. It may well have impacts on productivity, too—it was good to hear the noble Lord, Lord O’Neill of Gatley, talk about that earlier.

There is much to welcome in what the Government are doing in terms of the 275,000 new affordable houses promised by the end of the five years. There is much to welcome in the Bill, but I hope that your Lordships will keep it very much in mind that this will be an opportunity to increase the supply of social and key worker housing.

4.17 pm

Lord Heseltine (Con): My Lords, I congratulate my noble friend Lady Williams on the very clear way in which she summarised this fascinating piece of legislation, which is immensely wide in its potential and dependent almost entirely on the detail of offers that other people are yet to make. I am sure that noble Lords will

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appreciate that we have heard two speeches from opposition parties that were very helpful and supportive of what the Bill intends to do. In my view, we are discussing and implementing in this Bill an historic shift.

I was particularly interested in what the noble Earl, Lord Listowel, had to say. If there is an area of this country’s administration where devolution is necessary, it is in the poorest communities, which are all fragmented into different streams of funding from central government. There is no correlation or process at local level that draws the funding together and asks fundamental questions. If you live in that sort of circumstance—and no one in this noble House does—the one thing that is missing is a ladder of aspiration. There is no machine showing you how you can change the structure. There are lots of very well-meaning people with very substantial sums of money, but there is no central point where we can try to change the assumptions of deprivation that exist on a wide scale and in many different forms. The noble Earl may well be surprised, as this process unfolds, that there is great potential for the poorest communities in particular.

I think that the whole House recognises that today we are involved in an historic shift. We all understand how this process of centralism came about. We were a pre-eminent world power in the 18th century, and the driving force and motive was that of the accumulation of wealth, which created conditions for people that were totally unacceptable. In order to ameliorate the condition of the people, it was necessary for central government increasingly over more than a century to centralise the processes that would create an equality of adequate public service. It was a very benign and necessary part of the evolution of parliamentary democracy.

However, if the intention was benign, the consequences were not quite as happy. First, because it was very largely public sector-driven, the people who had created the wealth in the first place were marginalised, and in the process of decision-making they were largely eliminated over a very long period of time. Secondly, the process of redistributing the money that had to be collected locally to provide the services that were required led to a fragmentation of function in the great spending departments of London. I can remember only one occasion in my entire political career when the subject on the agenda was a city, and it was Liverpool after the riots of 1981. Many discussions took place about housing, policing, education and whatever, but at no meeting I can remember did we sit down and ask what we should be doing about the totality of this vital community called Liverpool, Leeds, Birmingham, Manchester or whatever it may be.

So the functionalism of the central process was extremely fragmenting in the application of opportunity for those areas. Frankly, and in many ways more sadly, it created a culture of deference, because the weight of money flowing back to local people and local communities was so heavy and the systems by which it flowed back were so intrusive that the culture that developed at local level was, “Tell us what to do” and “Show us what you want”. The willingness to challenge the central machine became inbuilt into the assumptions of too many people living in our great cities.

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The consequence of all this is that in this country we have devised a system of government unlike any other advanced economy. There is no economy of which I am aware—it may be that other noble Lords have a different experience—which has so concentrated power in its capital city and dictated by circular, edict, specific grant or ring-fence the precise detail in which a commonly devised formula is imposed on the whole of the economy. Noble Lords will realise that this Bill is about creating a better balance. It is not a revolution. Noble Lords who have spoken so far have talked about what has happened in the past, and there are many examples over the years. I know that the noble Lord, Lord Prescott, was very interested in this subject. The Labour Party can claim credit for creating the mayoralty of London.

I heard the noble Lord, Lord Shipley, make the proud claim that it is 40 years since he was first elected a councillor. I have to tell noble Lords that it is 45 years since as a junior Minister I entered the DCLG where I now have the honour to be a special adviser to the Secretary of State. I am glad that nobody has taken the trouble to look at the preposterous and ridiculous things I said about local government—that I created councils, destroyed councils and changed boundaries. All these things I did in the name of better governance, I said at the time. I come before your Lordships’ House today as a sinner that repenteth.

The precedent of the London mayor has been an exciting one, and no one would take it away, but there are many other mayors today. There is a Mayor of Liverpool. Nobody asked for a referendum in Liverpool. I disagree with the noble Lord, Lord Shipley, on this issue. A former Labour MP is now the Mayor of Leicester and is doing, so far as I can see—forgive the party politics—a perfectly acceptable job. Nobody suggested that there should be a referendum in Leicester. Built into the statute is endless provision for new mayors to be created within the existing framework of local government without a referendum, so why should we be preoccupied with this delaying tactic—because we know that that is what it will be?

Of course, the argument is that we did have a referendum, which from the point of view of those of us who believe in mayoral government was a disaster. Why was it a disaster? First, because it was completely controlled by the party machines, which were basically against anything that threatened their existence; and, secondly, because nobody bothered to vote. So on the idea that we are once again going to subject our great cities to a referendum—with perhaps the exception of Manchester, which has opted to take the leading steps towards one—I hope that when we get to Committee the House will come to the view that the opportunity, the prize and the timing are so urgent that we might be able to get on with the job and transfer power back to where we have taken it from over the past 150 years.

As I said, this is not a revolution. The last Government were, I think, extremely constructive. They worked with local enterprise partnerships, city deals, growth deals, the single pot and the northern powerhouse in pushing this agenda with determination and excitement. It is an evolution, not a revolution, but it is an evolution that is moving in a direction that will change the

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history of our country. There are things that will flow from it. First, there will be a massive potential saving in costs. I do not wish to trespass on the discussions about public expenditure cuts and the reviews that are coming; they would come under any Government, as we all know. But the fact is that with the local authority structure that we have today there is a massive overlay of costs, which will be challenged because the cuts that are coming will increase the pressure. They will not create it—the pressure is already there, and a whole range of dialogues are proceeding as to how local authorities can co-operate, amalgamate or whatever in order to cut not the services but the overhead costs of providing the services. That will be a benefit.

It is a huge change. Billions of pounds a year will be spent not because the functional apparatus of central London so designs but because local people say, “If we can spend it this way, we will get better results”—and that will build on the strength that exists in our communities and enhance the opportunities as local people see them.

It is a fact that it is a competitive process. There is no compulsion on any local authority or combination to come together to advance this cause, but if they do it will be by negotiation with central government, and in negotiating with central government they will want to ask basic questions about the administrative capability of the new structure to carry through the enhanced responsibilities that they will enjoy. That will mean that the new structure that emerges will have every incentive to diversify to encourage choice and to show ways in which it can do better than other competing local groupings—and that will raise standards as the more successful pioneer an enhanced form of service.

The next argument that flows from that is that if you distribute public money by competition, you get gearing. Many Members of this House will have been part of the process of the last 20 or 30 years in which we have shown increasingly that if you use money in a competitive sense—such as the urban development corporations, the City Challenge, the regional growth fund, city deals, the single pot—you get a significant enhancement of what the taxpayer can afford. The ratios are exciting; the most exciting of all, of course, was London Docklands at 10 times what the public had to pay, but the regional growth fund still returns something like five or six times what the taxpayer could afford. So although we talk of cuts—which, legitimately, members of the opposition party will want to do—the reality will be that in employment terms there will be no cuts, because the use of public money in a competitive environment, and the gearing that it will produce, will dwarf in increased employment the jobs lost in the public sector.

So there are many arguments in favour of the distribution of public money to the localities, but it is important to realise that this is not a take-it-or-leave-it, “Here’s the money; tell us how you got on” system. This is a new form of partnership and, whichever party is in power, it is entitled to see its manifesto implemented. Maybe the Government will have been elected to create more housing, or better health or higher education standards; whatever it may be, we are not in any way challenging the right of central government

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to have its manifesto implemented. What is different is that in the implementation of government policies the talent of the nation is involved in trying to do the best they can to implement that, as suits their own localities.

The devolution process is conducted by negotiation: by voluntary offers from the local communities in whatever form they want to combine, but then by agreement. One of the questions that they will have to answer, and rightly so, is: “What is the administrative structure that will actually carry out this new vision that you have put forward for your town, city, county or rural area?”. It follows that they may actually turn round and say, “Well, what is central government doing about the administrative way in which it deals with us?”. If one were a businessman, which of course as a politician one certainly is not, one would not accept one’s company being run in the way that central government runs its administrative relationships with local communities. So in asking local authorities and local enterprise partnerships how they would reorganise themselves to carry the responsibility now being devolved, it might well be that they will turn around and say to central government, “Will you please do something about reorganising yourselves so that we have a central point of contact with whom we can do business?”.

I hope that the good will expressed by all noble Lords who have spoken today will be carried through in the implementation of the Bill. The country, as we all know, faces an ever more competitive challenge, but the opportunities out there are equally attractive. The Bill is about encouraging people all over the country to help this nation grasp those new opportunities for themselves, their communities and local people.

4.33 pm

Lord Prescott (Lab): My Lords, it is a great pleasure to follow the noble Lord, Lord Heseltine. His words are often beguiling but you have to look at the small print. He has an excellent reputation for urban development in different parts of the United Kingdom, for which I give him credit. He was the man who welcomed me as a Back-Bencher on my maiden speech, so we have both been around for a bit. I recall that when I was in a Labour Cabinet, I had to get the Cabinet to agree to rescue his Dome, which turned out to be profitable, and then I had to rescue the Channel Tunnel rail link, HS1; it had collapsed in the private sector but the public sector solved it. So he and I have worked together to achieve some of the benefits of urban development.

It has been a great joy to listen to the noble Lord today but I have to say, when he talks of a “historic moment”, that he was in the Lobbies lobbying and voting against all the devolution proposals that were brought in by the Labour Government. Devolution in Scotland, Wales and Northern Ireland and a Greater London Authority with an elected mayor were all brought about by a Labour Government. Therefore it is not that historic at the moment; it has been there for a while, and most of it, with the noble Lord’s help, was basically abolished, or voted against, by the previous Administration.

I am therefore delighted to be here in a debate talking about devolution and how that can affect the north in particular. Again, the noble Lord, Lord Heseltine,

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has helped the development of the north a great deal.

No Stone Unturned

was a very important document that advanced some of the arguments he has just given. He always has solutions—except for the time he got kicked out of the Cabinet, but I will leave that alone at this moment—that are well thought-out and well respected in the areas they operate in.

I want to say to the noble Lord that devolution started two decades ago, and this is an extension of it. It is not the same kind of devolution; it is in a way considerably different from the kinds that we developed. As the noble Lord probably knows from the past, in 2006, when I was the Secretary of State, we produced the Northern Way. Everything in the powerhouse of the north was embodied in that document. So when they say, “Ah, the powerhouse of the north!” it is not original or historic—we did that 10 years ago. The real problem is that the Liberal Democrat and Conservative Government abolished it. As soon as they came in, in 2010, the Chancellor got rid of it and the regional development agencies—I suspect that the noble Lord, Lord Heseltine, rather admired them as a body; they did bring things together—but today this Government have taken that in a different direction.

I want to make a historic point about the documents produced at that time, but we are thankful that we are now moving to more decentralisation. The analysis given by the noble Lord, Lord Heseltine, on centralised government is absolutely right. I have felt that all my life here in Parliament. I was given the job by Michael Foot, who was the leader of the party in 1980, when we failed in the first referendum for Scottish devolution to find a solution for the English regions. The north-east, as the noble Lord, Lord Shipley, said, was very annoyed at how many powers could be given to Scotland but not to the north-east. I admit to my failure: I could not convince the Labour Government to give similar powers to English regions as they had given to Scotland. We gave them a referendum and we failed in the north-east, largely because I could not convince my colleagues to give more powers.

The situation now is very different. The position in Manchester now is about what was effected in Scotland. People say, “Right—we want these powers for the English regions”, and I fully support that and think that is right. However, as to how you interpret that, we must wait for the debate that will happen on how the resources are to come and what the powers will be. There will be some disagreement about turning local authorities into premier, championship and lower local authorities, all of which will now be given different powers and resources. On saving money, I can remember the other change in local government—I have been around long enough—when the county local authorities were set up. They did not save money; they cost a lot more in the end, and they had to be broken up in the main. Therefore, there are many lessons to be learned.

I will end on the point about the local and combined authorities. I am sure that it will be known to the noble Baroness, Lady Williams, because it is about what the noble Lord, Lord Heseltine, has been involved in, on which we are now again joined with him: how you unite the ports of the north. Hull and Manchester are on a great corridor, not just for Britain to go to the

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European market; we are beginning to see an Atlantic super-port in Liverpool, with big container wharf developments; international negotiations are now taking place on the new American trade between the US and Europe; and there is the development and growth of the East, and the big consumer market in Europe. That land route between Manchester and Hull will be one of the big global corridors, which is very important.

The problem for me, now, is that one port—Merseyside—is in a combined authority, while Hull is not. It is always left on the side—we do not deal with Hull. When you look at the transport policy that was produced by those combined authorities, it stopped at Leeds. It never came into Yorkshire or saw the East Riding. If you want to develop a port strategy, which would be a great asset for the north, you need to develop both ports. The Humber is becoming a massive energy base for renewables and is a major port that looks to Europe, while Merseyside looks to the Atlantic. They are the two important ports. So what is my complaint? My complaint is that, as we have found already with the transport document produced by the combined authorities, they can only really begin to opt in people from Hull and other areas but these are not part of the decision-making process. With two big gateways like that which are connected for trade and transport, it is stupid to have one authority that has the power and resources and is combined authority, such as Liverpool, with massive investment from the Peel organisation, and the other authority in Hull which is not included.

I want to put a question to the noble Baroness, Lady Williams. I do not know whether she realises that she attended one of my meetings where I made this argument, and I hope that that does not damage her career. However, it was very good that she came to Hull, which involves a long journey. Hull wants this development but it cannot get into the game. It has already written to Richard Leese and asked whether it can be included as a city region but it has been told, “No, you can’t”. Now it is expanding. Cardiff, Birmingham and Glasgow have been brought in and there is now a big national grouping of authorities. They are the ones that will really have the influence on government, and they are the ones who are promising to have a Lord in charge. I mean a mayor in charge, although it may be a Lord—who knows? Basically they need to be on the same footing. I have a letter from Richard Leese, who is now the chairman of all the combined authorities and whose name is on my Northern Way document. Basically, Richard Leese has said that city regions such as Hull—and there are many others—cannot get into the game when the priority is being given to the combined authorities.

I have a question for the noble Baroness. The notes to the Bill say that certain authorities can, under order, join in. A commission in Hull has just reported. The arguments between Hull and Beverley are in the past; they have come together. The first combined authority was developed in 2006, when we were in government, so the current Government are not unique or historic in that respect. There is now talk of Leeds being involved. Leeds is looking at how to have a big North Yorkshire authority, involving the whole area

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and the authorities in Humberside. How would that work? Would they just make an application—a promise to have an election for a mayor? Of course, with decentralisation the Government tell you what you have to have, but I will leave that to one side. Authorities want to know how to do that, and not only Hull—a big one will be put together if it goes in with Leeds. How will that process work and how long will it take? I feel it is important that local authorities are given these answers.

Hull just wants to be in the game. It is an important gateway to Europe and there is an important trade barrier. Hull needs to be part of this. It is always being left aside as a fishing port. Well, it ain’t now; it is a major port crucial to the development of the northern economy. I do not care whether you call it a powerhouse economy—the northern powerhouse—or the northern way. We need to get on with the investment. That is an essential part of economic and transport development, coupling with what is happening in the London of the north—namely, Manchester. Perhaps the Minister can give us some information about that.

Clandestine Migrants

Statement

4.43 pm

The Minister of State, Home Office (Lord Bates) (Con): My Lords, with the leave of the House, I will repeat a Statement given earlier today in another place by my honourable friend the Immigration Minister, James Brokenshire.

“Mr Speaker, last Thursday evening, Border Force officers at the port of Harwich detected and intercepted 68 migrants who were seeking to enter the UK illegally and clandestinely. The discovery came after four lorries were selected for examination and searching through Border Force’s normal operating procedures. Among the 68 migrants found were two pregnant women and 15 children. Seven migrants complained of chest pains and nausea and were taken to hospital as a precautionary measure. All four drivers of the lorries involved were arrested on suspicion of facilitating illegal immigration. They have been bailed but continue to be under investigation by law enforcement bodies, including the National Crime Agency.

Of the 68 people found, 35 were Afghans, 22 were Chinese, 10 were Vietnamese and one was Russian. None of those taken to hospital, including the two pregnant women, was found to have a substantive medical condition of concern. Some of the individuals have claimed asylum, and UK Visas and Immigration is considering their claims, including suitability for the “detained fast track” process. Two of the asylum seekers are unaccompanied minors and have been placed in the care of Essex social services. We have already begun the work to seek the removal of the remaining migrants from the UK.

If we can show that those who are claiming asylum have also claimed in another EU member state, we will seek to remove them under the Dublin regulation. This regulation has allowed us to remove 12,000 asylum seekers from the UK since it came into force in 2003.

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However, it relies on member states fulfilling their obligations systematically to identify and fingerprint migrants apprehended at the EU border. Unfortunately, we know that some member states are still not fulfilling these obligations, which is a matter that we continue to raise with them at the highest levels. This Government are clear that the EU’s approach to migratory flows must include proper management of the external border, the prompt return of those who are not in genuine need of protection and action to tackle the efforts of smugglers and traffickers who profit from human misery.

I am aware that my honourable friend the Member for Harwich and North Essex visited the port on Friday, which is in his constituency. I would like to echo and endorse his complimentary words about the work of Border Force. Border Force conducts rigorous checks on lorries and other vehicles as they arrive at UK ports of entry on a targeted basis, as was the case at Harwich on Thursday evening. Such checks are undertaken by skilled officers, who have the expertise to identify individuals who are often well-hidden in vehicles, and involve the use of state-of-the-art scanning and X-ray technology. Thursday night’s incident at Harwich comes on the back of a number of other excellent results by the Border Force team at that port. Among other successful operations in recent months, the Border Force team has made some significant seizures, including 15 kilograms of heroin in December, 17 kilograms of cocaine in May and 2.9 million cigarettes in March.

With regards to the specific problem of clandestine immigrants, Border Force concentrates a significant amount of resource at the juxtaposed ports in northern France, where the vast majority of illegal border crossings are attempted. All lorries undergo enhanced screening at these locations. Our approach is dynamic and intelligence led. Border Force is able to, and does, move its resources around on the basis of threat to ensure that we keep one step ahead of the criminal gangs that exploit vulnerable people and try to circumvent our immigration laws.

The important work that Border Force officers carry out detecting and intercepting those who attempt to enter the UK illegally, in conjunction with law enforcement agencies in the UK and internationally, is vital in the fight against organised criminal networks engaged in people smuggling. These gangs show a callous disregard for human life and seek to make a profit out of other people’s misery. I commend Border Force for its discovery last week and for the work that it does to protect the UK’s borders. I commend this Statement to the House.”

4.47 pm

Lord Rosser (Lab): My Lords, I thank the Minister for repeating the Statement.

The people found at Harwich are victims of criminal gangs, just like those found on boats in the Mediterranean. What action are the Government taking to ensure that there is a more concerted UK and EU drive to seek to stop this trade in human beings at its source? To secure our borders, what percentage of lorries and containers are now routinely checked at UK ports of entry? John Vine, the former inspector of borders, stated at the weekend that good intelligence and

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experienced staff were critical but that a lot of experienced staff were leaving and not being replaced. Is that true? Finally, can the Minister say whether or not Border Force funding is ring-fenced from the Home Office funding cut that was announced by the Government last week?

Lord Bates: My Lords, I will take the points raised by the noble Lord, Lord Rosser, in turn.

The noble Lord is absolutely right to say that it is one thing to try to tackle these problems when they arrive in the UK but far more productive to focus that effort in areas and countries where there is insecurity. That is part of the reason why so much of the work of DfID and the Foreign Office in places such as Syria is about trying to intervene to provide stability and security in those areas so that people do not undertake the perilous journey, in the case of the Mediterranean, or become victims of the criminal gangs that we have talked about.

The second thing that we can do in that regard is to strengthen the laws in relation to this. With a large degree of cross-party support in the last Parliament, we introduced the Modern Slavery Act, the Counter-Terrorism and Security Act and the Serious Crime Act, all of which were aimed at trying to disrupt activity and increase the penalties for those concerned.

The noble Lord asked some specific points about the operations and the percentage of checks that are carried out. This work is very much intelligence led. Border Force works very closely with the National Crime Agency and it will pass on intelligence to particular ports for the screening of vehicles. The actual percentage may change from port to port on the basis of intelligence that is received at that point. We can also take some confidence—without for one second being complacent—from the performance of Border Force in areas such as Harwich for the examples that I gave earlier.

There is a three-pronged approach: the first is tackling the issue upstream; the second is the greater use of technology; and the third is greater use of intelligence. We must also strengthen the legal framework to ensure that those people who engage in this pernicious activity of trafficking people across countries get the punishment that they deserve.

4.51 pm

Lord Paddick (LD): I thank the Minister for repeating the Statement. Does he agree that proper management of the EU’s external border is the key to solving these issues, and that the UK is in a far better position within the EU to influence member states than it would be if it were outside the European Union? The Minister also mentioned the Dublin regulation and the fact that more than 12,000 illegal immigrants who claimed asylum initially in other EU states had been deported from the UK as a result of that regulation. Will he tell the House whether that regulation would still apply if the UK were no longer a member of the European Union?

Lord Bates: The noble Lord is absolutely right that the work of FRONTEX in securing the borders of Europe is vital. We believe that it could be doing a better job, but we are co-operating with the agency at the present

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time—I believe that members of the police, the National Crime Agency and Border Force are working very closely with FRONTEX. One of the areas in which we would like to see it perform better is in taking fingerprint data as soon as people come into the European Union area. That would help in tracking them down.

The noble Lord is correct to say that this is a growing European problem. We are seeing a significant increase in the numbers of migrants coming into the EU—around 600,000. It is a European problem, but it goes beyond Europe’s borders. We are sure that our partnership in working together with other European countries—as we have done in this case with the Dutch, and as we are doing with the juxtaposed controls with the French—is an integral element of being able to tackle this going forward.

Baroness Ludford (LD): The Minister referred to European instruments and my noble friend took up that theme, but I want to ask about carriers’ liability, which is also the subject of an EU legal instrument. Like the noble Lord, Lord Rosser, I heard John Vine, a former borders inspector at the weekend saying that there had been no sanctions on hauliers or confiscation of vehicles where they were found to have been carrying irregular migrants—he implied that there had been none at all. Is that the case, and, if so, why? Why have there not been any sanctions for breach of carrier liability legislation?

Lord Bates: We have to work closely with the hauliers. In March, my honourable friend the Immigration Minister met with the hauliers to discuss what part they can play in this, because that is certainly in their interests. I can say that the four vehicles found to be carrying these illegal migrants through Harwich have been seized, and there will be ongoing legal discussions because the case has to be proved in the courts, as the noble Baroness would expect. Of course, there are many other areas where I can point to seizures which have taken place, and I will certainly write to her on the specific number. I should say that a major part of the Serious Crime Act is about strengthening the powers of the courts so that they are able to seize the assets of those engaged in people trafficking—if that is the case in this particular instance—whether the assets be lorries or boats in the Mediterranean, so that they cannot actually continue with their evil trade.

Baroness Scott of Needham Market (LD): My Lords, first, I wish to declare an interest as a member of the board of the Harwich Haven Authority.

Does the noble Lord agree that the early finding of such people is not just a matter of politics but of humanitarian decency, because the impact on those who are not found in such conditions is catastrophic? Can he assure the House that proper attention is being paid to the rest of the ports community and not just to the Border Force, because it is the wider ports community which is more likely to have the first inkling that something is not right? Perhaps they need a bit more help in understanding what they should be looking for and how we can help to prevent these catastrophes turning into a humanitarian disaster.